Samsung's profit jumps 46 percent thanks to semiconductor

Samsung has reported its highest quarterly profit since 2013 on the back of increased demand for components.

Net profit for the January to March period amounted to 7.68 trillion won (US$6.7 billion), up 46% from a year ago, Samsung Electronics said.

Samsung Electronics, the country's top market cap, gained 2.43 percent to end at 2,192,000 won on strong first-quarter earnings and shareholder-friendly measures.

Samsung shares gained 2% in Thursday morning trading in Seoul.

The tight supplies and solid demand, pushed prices for Samsung's key microchip products called NAND and DRAM up sharply, giving it fat margins. That's right. After the last explosion episode of the Note 7 model, no one expected that Samsung would launch the flagship Note series so early.

Samsung is anticipated to show a full-fledged recovery of its smartphone business in the second quarter as sales of the Galaxy S8 and the Galaxy S8 Plus kicked off in earnest last week.

Samsung's chip business was the company's stellar performer, with a record 6.3trn won (€5bn) operating profit.

But the firm's mobile business saw sales and profit slow with its first quarter operating profit at 2.07 trillion won, down from 3.9 trillion won a year ago.

While Samsung still recovers from the Note 7 crisis, the smallest possible issue with its devices is likely to cause alarm bells for its consumers. Such market conditions are unlikely to change in coming months, so analysts expect Samsung to rake in its best ever earnings in 2017.

Vice-Chairman Lee Jae-yong, the heir to the Samsung group, has been held in custody and is on trial for bribery, with other key executives, in connection with the sprawling corruption scandal that brought down South Korean president Park Geun-hye. Samsung has said a few times so far that it's not a manufacturing defect, and vowed to release a software update that will let users fix the problem themselves.

As everyone knows by now, the previous handset in the Galaxy Note series, Note7, suffered from the ignominy of multiple worldwide recalls and more than $5 billion in damages, as it was found to be exploding involuntarily especially during charging. Samsung also announced plans to cancel existing treasury shares worth over $35 billion by 2018, accepting proposals submitted by activist hedge fund Elliott.

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